New WeChat Ads Could Vex Consumers

ByElisabeth Rosen ·

21 March 2016

WeChat’s operator Tencent doubled online ad revenue in Q4 amid an aggressive push to monetize the messaging platform. However, brands might benefit more from building their presence on the platform than purchasing ads.

WeChat is the right place for brands to reach Chinese smartphone users, who spend more than an hour on the platform every day. But too many ads could irritate them. Beijing marketer Ren Jing told The Wall Street Journal that she would be annoyed by any increase in advertising.

“There is no escape from WeChat. My friends and business contacts are all using it,” said Ren, who spends multiple hours per day on the app.

Half of brands in China tracked by L2 have established presences on WeChat, suggesting they recognize its importance as both a shopping and discovery platform. It also means a WeChat account is no longer an edge; brands must add and leverage WeChat’s line of commerce and brand awareness features. Yet few do so. Only one-fifth of brand accounts let followers connect their WeChat accounts to loyalty programs, and barely any use the platform’s in-app purchase capabilities.

Cartier and YOOX are among the few luxury brands ahead of the game in engaging WeChat users, and have utilized the platform’s shake feature to help consumers discover new products and direct them along the road to purchase. These efforts could outweigh advertising as effective strategies to drive sales.